Interpretation Response #PI-20-0014

Below is the interpretation response detail and a list of regulations sections applicable to this response.

Interpretation Response Details

Response Publish Date: 10/07/2021

Company Name: Manatt, Phelps, and Phillips, LLP representing Chemoil

Individual Name: Mr. Matthew Williamson

Location State: CA Country: US

View the Interpretation Document

Response text:

Mr. Matthew Williamson
Manatt, Phelps, and Phillips, LLP
695 Town Center Drive, 14th Floor
Costa Mesa, CA 92626

Dear Mr. Williamson:

In an October 23, 2020, letter to the Pipeline and Hazardous Materials Safety Administration (PHMSA), you, on behalf of Chemoil Terminals Corporation and its affiliates (Chemoil), requested an interpretation of 49 Code of Federal Regulations (CFR) Part 195. Specifically, Chemoil requests an interpretation pertaining to the definition of the term "buried" in 49 CFR § 195.553, and confirmation that certain breakout tanks located at Chemoil's storage facility in Carson, California are not considered "buried" and, therefore, do not require cathodic protection (CP) pursuant to 49 CFR § 195.563(a).

In the letter, Chemoil states that it has five breakout tanks constructed between 2002 and 2008, each with a 4-inch fiber mesh concrete pad, 80 mil high density polyethylene (HDPE) liner (sloped to provide drainage to monitoring wells), and a sealed ring wall. Chemoil also states that each tank design considered corrosion control in accordance with API Recommended Practice (RP) 651 and API Standard 653.¹ Chemoil asserts that because these tanks are not in contact with the soil, they do not meet the definition of "buried" under § 195.553 and, therefore, do not require CP under § 195.563(a).

Section 195.563(a) of the Federal Pipeline Safety Regulations requires each buried or submerged pipeline that is constructed, relocated, replaced, or otherwise changed after the applicable date in § 195.401(c) to have CP. The term "pipeline" expressly includes breakout tanks under § 195.2. Section 195.553 defines "buried" as "covered or in contact with the soil." Accordingly, only breakout tanks in contact with soil would be required to have CP under the regulations. Section 195.583(a) of the regulations requires that each onshore pipeline that is exposed to the atmosphere must be inspected for evidence of atmospheric corrosion at least once every three years. If a breakout tank is not in contact with soil, operators must consider whether the tank is exposed to the atmosphere and, if so, comply with subpart H of Part 195 to monitor and remediate atmospheric corrosion.

¹ PHMSA notes that the designs submitted with this interpretation request may not be in compliance with API RP 651, 3rd edition, 2007, where Section 6 – Methods of Cathodic Protection for Corrosion Control and Section 7 – Design of Cathodic Protection Systems, states that no cathodic protection systems are effective in protecting a HDPE liner if the HDPE liner does not completely and effectively protect the interface areas. API RP 651 allows for usage of HDPE liners when the liners eliminate contact with soil and do not allow moisture to reach the external bottom of the tank. API RP 651 describes a continuous concrete pad in Section 5.3.3.

Chemoil asserts that the entire footprint of each breakout tank is separated from the soil by a fiber mesh concrete pad, a HDPE liner, and a reinforced ring wall and sump foundation and, therefore, there is no path for electrical current to travel from the soil to the tank. The designs submitted with Chemoil's letter, however, show the tank HDPE liner does not extend past the edges of the tank and stops where the concrete pad and reinforced ring wall meet (interface area). The drawings submitted by Chemoil do not show that the HDPE liner goes past this interface to ensure that the tank is not in contact with soil or that it eliminates moisture from entering the interface area. Actual inspection results provided by Chemoil show that at least one breakout tank developed corrosion on the bottom of the tank, indicating moisture was able to permeate either the concrete floor, the interface area, or from outside the reinforced ring wall. This moisture penetration created a corrosive environment on the bottom of the breakout tank. Based on the submission, it is unclear to PHMSA whether the tank is in contact with the soil since it appears that there is an electrolytic path to the tank bottom. Please see the footnote below for applicable sections of API RP 651.²

If Chemoil's tanks are in fact not in contact with any types of soil, they would not be considered "buried" under the regulations. However, if the tanks are not in contact with soil and are exposed to the atmosphere, then Chemoil would be required to monitor the tanks for atmospheric corrosion, pursuant to § 195.583. It appears, from the information provided, that there is an electrolytic path to the tank floor bottoms, so the tanks may be in contact with soil by that path, or exposed to the atmosphere at the tank bottom interface area, which would require compliance with either §§ 195.563 and 195.565, or § 195.583, respectively.

As mentioned above, your inspection results indicate that at least one of the breakout tanks described has developed corrosion on the bottom of the tank. PHMSA notes that Chemoil is required to take corrective actions to remedy the corrosion in accordance with §§ 195.401(b), 195.573(e) and 195.583(c).

² API RP 651, Paragraph 5.3.3.3 gives an operator the following information concerning installing a concrete pad under an aboveground storage tank:

Due to numerous complex factors that can affect the corrosion of a tank bottom underside in the presence of concrete, prediction of the propensity of corrosion in this case is extremely difficult. Thus, care should be observed with tanks on concrete pads since cathodic protection most likely will not help reduce any corrosion that might occur.

Also, API RP 651, Paragraph 5.3.3.2 states that "[i]n situations where water may condense on the tank bottom or water is retained above the concrete pad, accelerated corrosion may occur."

PHMSA provides written clarifications of the Federal Pipeline Safety Regulations (49 CFR Parts 190-199) in the form of interpretation letters. These letters reflect the agency's current application of the regulations to the specific facts presented by the person requesting the clarification. Interpretations do not create legally enforceable rights or obligations and are only provided to help the public understand how to comply with the regulations.

If we can be of further assistance, please contact Tewabe Asebe at 202-366-5523.

Sincerely,

John A. Gale
Director, Office of Standards
and Rulemaking

Regulation Sections